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2026-07-06 09:52:37 -04:00

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LegalText 11 U.S.C. § 1304 Debtor engaged in business us united_states_code code_section 11 BANKRUPTCY 13 ADJUSTMENT OF DEBTS OF AN INDIVIDUAL WITH REGULAR INCOME 1304 11 U.S.C. § 1304 current 119-100 2026-06-26 official https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip /us/usc/t11/s1304 data/legal/raw/us/code/title-11/usc11.xml 3b7abaa45457e048ee30f793fdd9546601cf957c324b94b01d5e36decc9c308e 49b32bf784de01de21874d64b5d1d78d1d245352824a03caa6d6b941a4a2c9a2 9b9066df178183cdf8a9bdb3402392559dc5bd898a1d55afde2ccd980cebb369 2026-07-04 official
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11 U.S.C. § 1304 - Debtor engaged in business

Text

(a) A debtor that is self-employed and incurs trade credit in the production of income from such employment is engaged in business.

(b) Unless the court orders otherwise, a debtor engaged in business may operate the business of the debtor and, subject to any limitations on a trustee under sections 363(c) and 364 of this title and to such limitations or conditions as the court prescribes, shall have, exclusive of the trustee, the rights and powers of the trustee under such sections.

(c) A debtor engaged in business shall perform the duties of the trustee specified in section 704(a)(8) of this title.

(Pub. L. 95598, Nov. 6, 1978, 92 Stat. 2646; Pub. L. 98353, title III, §§ 311(b)(2), 526, July 10, 1984, 98 Stat. 355, 389; Pub. L. 111327, § 2(a)(40), Dec. 22, 2010, 124 Stat. 3562.)

Notes

Historical and Revision Notes

legislative statementsSection 1304(b) of the House amendment adopts the approach taken in the comparable section of the Senate amendment as preferable to the position taken in the House bill.

senate report no. 95989Increased access to the simpler, speedier, and less expensive debtor relief provisions of chapter 13 is accomplished by permitting debtors engaged in business to proceed under chapter 13, provided their income is sufficiently stable and regular to permit compliance with a chapter 13 plan [section 101(24)] and that the debtor (or the debtor and spouse) do not owe liquidated, noncontingent unsecured debts of $50,000, or liquidated, noncontingent secured debts of $200,000 (§ 109(d)). Section 1304(a) states that a self-employed individual who incurs trade credit in the production of income is a debtor engaged in business. Subsection (b) empowers a chapter 13 debtor engaged in business to operate his business, subject to the rights, powers and limitations that pertain to a trustee under sections 363(c) and 364 of title 11, and subject to such further limitations and conditions as the court may prescribe. Subsection (c) requires a chapter 13 debtor engaged in business to file with the court certain financial statements relating to the operation of the business.

Editorial Notes

Amendments2010—Subsec. (c). Pub. L. 111327 substituted “704(a)(8)” for “704(8)”. 1984—Subsec. (b). Pub. L. 98353, § 526, struck out the comma after “of the debtor”. Subsec. (c). Pub. L. 98353, § 311(b)(2), substituted “section 704(8)” for “section 704(7)”.

Statutory Notes and Related Subsidiaries

Effective Date of 1984 AmendmentAmendment by Pub. L. 98353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98353, set out as a note under section 101 of this title.